Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 07, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2023 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2023 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-41227 | |
Entity Registrant Name | CISO GLOBAL, INC. | |
Entity Central Index Key | 0001777319 | |
Entity Tax Identification Number | 83-4210278 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 6900 E. Camelback Road | |
Entity Address, Address Line Two | Suite 900 | |
Entity Address, City or Town | Scottsdale | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85251 | |
City Area Code | (480) | |
Local Phone Number | 389-3444 | |
Title of 12(b) Security | Common Stock, $0.00001 par value | |
Trading Symbol | CISO | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Elected Not To Use the Extended Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 178,006,398 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 1,872,175 | $ 1,833,163 |
Accounts receivable, net | 8,657,543 | 7,862,297 |
Inventory | 57,232 | 11,803 |
Prepaid cost of revenue | 2,807,001 | 2,634,667 |
Prepaid expenses and other current assets | 2,252,813 | 1,724,650 |
Contract asset | 376,022 | 332,215 |
Total Current Assets | 16,022,786 | 14,398,795 |
Property and equipment, net | 4,486,787 | 4,680,495 |
Right of use asset, net | 889,010 | 255,687 |
Intangible assets, net | 4,300,724 | 8,475,229 |
Goodwill | 37,343,368 | 76,664,017 |
Other assets | 18,597 | 22,592 |
Total Assets | 63,061,272 | 104,496,815 |
Current Liabilities: | ||
Accounts payable and accrued expenses | 13,258,971 | 8,310,337 |
Deferred revenue | 5,049,998 | 4,472,140 |
Lease liability | 191,995 | 121,731 |
Loans payable | 3,593,253 | 7,758,831 |
Convertible notes payable | 1,050,000 | 2,550,000 |
Total Current Liabilities | 23,144,217 | 23,213,039 |
Long-term Liabilities: | ||
Loans payable, net of current portion | 3,745,586 | 4,243,802 |
Lease liability, net of current portion | 732,675 | 159,205 |
Deferred tax liability | 435,678 | |
Total Liabilities | 32,622,478 | 28,051,724 |
Commitments and Contingencies | ||
Stockholders’ Equity: | ||
Common stock, $.00001 par value; 300,000,000 shares authorized; 178,006,398 and 146,395,807 issued and outstanding at June 30, 2023 and December 31, 2022, respectively | 1,777 | 1,464 |
Preferred stock, $.00001 par value; 50,000,000 shares authorized; 0 shares issued and outstanding on June 30, 2023 and December 31, 2022, respectively | ||
Additional paid-in capital | 169,712,000 | 153,168,984 |
Accumulated translation adjustment | 2,682,973 | 1,062,247 |
Accumulated deficit | (141,957,956) | (77,787,604) |
Total Stockholders’ Equity | 30,438,794 | 76,445,091 |
Total Liabilities and Stockholders’ Equity | 63,061,272 | 104,496,815 |
Related Party [Member] | ||
Long-term Liabilities: | ||
Convertible notes payable, related party | $ 5,000,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares outstanding | 178,006,398 | 146,395,807 |
Common stock, shares issued | 178,006,398 | 146,395,807 |
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenue: | ||||
Total revenue | $ 15,524,994 | $ 11,227,945 | $ 29,251,675 | $ 20,557,355 |
Cost of revenue: | ||||
Total cost of revenue | 14,513,160 | 10,462,452 | 27,840,757 | 19,743,146 |
Total gross profit | 1,011,834 | 765,493 | 1,410,918 | 814,209 |
Operating expenses: | ||||
Professional fees | 663,552 | 945,148 | 2,340,939 | 1,568,209 |
Advertising and marketing | 53,776 | 240,504 | 169,170 | 395,845 |
Selling, general and administrative | 6,112,875 | 4,468,415 | 15,621,641 | 9,171,958 |
Stock based compensation | 2,115,039 | 2,404,049 | 5,744,014 | 4,969,559 |
Impairment of goodwill | 20,838,804 | 41,038,172 | ||
Total operating expenses | 29,784,046 | 8,058,116 | 64,913,936 | 16,105,571 |
Loss from operations | (28,772,212) | (7,292,623) | (63,503,018) | (15,291,362) |
Other income (expense): | ||||
Other income | 209,639 | 17,425 | 53,219 | 29,968 |
Interest expense, net | (766,090) | (64,648) | (1,156,231) | (108,233) |
Total other income (expense) | (556,451) | (47,223) | (1,103,012) | (78,265) |
Loss before income taxes | (29,328,663) | (7,339,846) | (64,606,030) | (15,369,627) |
Benefit from income taxes | (435,678) | |||
Net loss | (29,328,663) | (7,339,846) | (64,170,352) | (15,369,627) |
Foreign currency translation adjustment | (416,236) | (2,200,710) | 1,620,726 | (1,298,269) |
Comprehensive loss | $ (29,744,899) | $ (9,540,556) | $ (62,549,626) | $ (16,667,896) |
Net loss per common share - basic | $ (0.18) | $ (0.05) | $ (0.42) | $ (0.11) |
Net loss per common share - diluted | $ (0.18) | $ (0.05) | $ (0.42) | $ (0.11) |
Weighted average shares outstanding - basic | 165,105,048 | 136,127,157 | 151,406,985 | 134,738,684 |
Weighted average shares outstanding - diluted | 165,105,048 | 136,127,157 | 151,406,985 | 134,738,684 |
Security Managed Services [Member] | ||||
Revenue: | ||||
Total revenue | $ 13,590,505 | $ 10,376,169 | $ 25,356,638 | $ 18,428,394 |
Cost of revenue: | ||||
Total cost of revenue | 7,309,461 | 3,765,426 | 12,870,024 | 6,368,350 |
Professional Services [Member] | ||||
Revenue: | ||||
Total revenue | 1,934,489 | 851,776 | 3,895,037 | 2,128,961 |
Cost of revenue: | ||||
Total cost of revenue | 250,740 | 163,152 | 449,033 | 273,489 |
Cost of Payroll [Member] | ||||
Cost of revenue: | ||||
Total cost of revenue | 5,255,778 | 4,707,984 | 11,056,435 | 9,153,834 |
Stock based Compensation [Member] | ||||
Cost of revenue: | ||||
Total cost of revenue | $ 1,697,181 | $ 1,825,890 | $ 3,465,265 | $ 3,947,473 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | AOCI Attributable to Parent [Member] | Retained Earnings [Member] | Total |
Balance at Dec. 31, 2021 | $ 1,258 | $ 69,309,369 | $ (44,012,422) | $ 25,298,205 | ||
Balance, shares at Dec. 31, 2021 | 125,852,971 | |||||
Stock based compensation - stock options | 8,179,332 | 8,179,332 | ||||
Stock based compensation - common stock | $ 4 | 737,696 | 737,700 | |||
Stock based compensation - common stock, shares | 434,000 | |||||
Exercise of options | $ 5 | 277,707 | 277,712 | |||
Exercise of options, shares | 454,111 | |||||
Foreign currency translation | (1,298,269) | (1,298,269) | ||||
Net loss | (15,369,627) | (15,369,627) | ||||
Stock issued for cash in public offering | $ 21 | 9,521,777 | 9,521,798 | |||
Stock issued for cash in public offering, shares | 2,060,000 | |||||
Stock issued for True Digital acquisition | $ 74 | 34,726,306 | 34,726,380 | |||
Stock issued for True Digital acquisition, shares | 7,406,100 | |||||
Stock issued for VelocIT acquisition | $ 3 | (3) | ||||
Stock issued for VelocIT acquisition, shares | 256,678 | |||||
Stock issued for Red74 acquisition | ||||||
Stock issued for Red74 acquisition, shares | 34,000 | |||||
Stock issued for Creatrix acquisition | $ 6 | 3,629,994 | 3,630,000 | |||
Stock issued for Creatrix acquisition, shares | 600,000 | |||||
Balance at Jun. 30, 2022 | $ 1,371 | 126,382,178 | (1,298,269) | (59,382,049) | 65,703,231 | |
Balance, shares at Jun. 30, 2022 | 137,097,860 | |||||
Balance at Dec. 31, 2022 | $ 1,464 | 153,168,984 | 1,062,247 | (77,787,604) | 76,445,091 | |
Balance, shares at Dec. 31, 2022 | 146,395,807 | |||||
Stock based compensation - stock options | 8,635,778 | 8,635,778 | ||||
Stock based compensation - common stock | $ 35 | 733,465 | 733,500 | |||
Stock based compensation - common stock, shares | 3,500,000 | |||||
Stock issued for cash | $ 268 | 6,681,930 | 6,682,198 | |||
Stock issued for cash, shares | 26,739,853 | |||||
Exercise of options | $ 10 | 491,843 | $ 491,853 | |||
Exercise of options, shares | 1,040,817 | 1,040,817 | ||||
Foreign currency translation | 1,620,726 | $ 1,620,726 | ||||
Net loss | (64,170,352) | (64,170,352) | ||||
Balance at Jun. 30, 2023 | $ 1,777 | $ 169,712,000 | $ 2,682,973 | $ (141,957,956) | $ 30,438,794 | |
Balance, shares at Jun. 30, 2023 | 177,676,477 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (64,170,352) | $ (15,369,627) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock based compensation - stock options | 8,635,778 | 8,179,332 |
Stock based compensation - common stock | 573,501 | 737,700 |
Depreciation and amortization | 1,813,305 | 1,163,463 |
Right of use amortization | 100,460 | 127,805 |
Other | 43,750 | (1,455) |
Impairment of intangible assets | 3,116,039 | |
Impairment of goodwill | 41,038,172 | |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | (617,138) | 1,416,754 |
Inventory | (46,776) | (199,559) |
Contract assets | (43,807) | (261,961) |
Prepaids and other current assets | (252,169) | (2,131,480) |
Accounts payable and accrued expenses | 4,172,201 | 2,675,346 |
Lease liability | (90,049) | 120,536 |
Settlement liability | (470,000) | |
Deferred revenue | 408,125 | 438,672 |
Net cash used in operating activities | (5,318,960) | (3,574,474) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (148,866) | (200,504) |
Cash (paid)/acquired in acquisitions, net | (4,914,196) | |
Net cash (used in)/provided by investing activities | (148,866) | (5,114,700) |
Cash flows from financing activities: | ||
Proceeds from sale of common stock | 6,682,198 | 9,521,798 |
Proceeds from stock option exercise | 491,853 | 277,712 |
Proceeds from loan payable | 2,210,022 | 5,000,000 |
Proceeds from convertible notes payable, related party | 5,000,000 | |
Proceeds from convertible note payable | 1,050,000 | 1,000,000 |
Proceeds from line of credit | 144,307 | 86,585 |
Payment on line of credit | (149,693) | |
Payment on loans payable | (7,297,980) | (895,053) |
Payment on notes payable, related party | (184,758) | |
Payment of convertible note payable | (2,550,000) | |
Payment of debt issuance cost | (87,500) | (25,000) |
Net cash provided by financing activities | 5,493,207 | 14,781,284 |
Effect of exchange rates on cash and cash equivalents | 13,631 | (48,625) |
Net increase in cash and cash equivalents | 39,012 | 6,043,485 |
Cash and cash equivalents - beginning of the period | 1,833,163 | 2,725,035 |
Cash and cash equivalents - end of the period | 1,872,175 | 8,768,520 |
Cash paid for: | ||
Interest | 926,441 | 91,234 |
Income taxes | ||
Supplemental disclosure of non-cash transactions: | ||
Operating lease assets obtained in exchange for operating lease obligations | 733,782 | 226,941 |
Common stock issued in True Digital acquisition | 34,726,380 | |
Common stock issued in Creatrix acquisition | $ 3,630,000 |
ORGANIZATION OF BUSINESS AND GO
ORGANIZATION OF BUSINESS AND GOING CONCERN | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION OF BUSINESS AND GOING CONCERN | NOTE 1 – ORGANIZATION OF BUSINESS AND GOING CONCERN Description of the Business We are a cybersecurity and compliance company comprised of highly trained and seasoned security professionals who work with clients to improve their cybersecurity posture. We provide a full range of cybersecurity consulting and related services, encompassing strategy and risk, cyber defense operations, architecture and engineering, and readiness and resiliency. Our services include secured managed services, compliance services, security operations center (“SOC”) services, virtual Chief Information Security Officer (“vCISO”) services, incident response, digital forensics, technical assessments, and cybersecurity training. We believe that culture is the foundation of every successful cybersecurity and compliance program. To deliver that outcome, we deliver a holistic solution that provides these services in a unified way from a dedicated team of subject matter experts. In contrast to the majority of cybersecurity firms that are focused on a specific technology or service, we seek to differentiate ourselves by remaining technology agnostic, focusing on aggregating teams of highly sought-after practitioners. We continually seek to identify and acquire cybersecurity talent to expand our service scope and geographical coverage to provide the best possible service for our clients. We believe that bringing together a world-class team of technological experts with multi-faceted expertise in the critical aspects of cybersecurity is key to providing technology to our clients in a business environment that is experiencing challenges attracting and retaining cybersecurity talent, thereby setting us apart from competitors and in-house security teams. Our goal is to create a culture of security and to help quantify, define, and capture a return on investment from information technology and cybersecurity spending. Our brand rallies around the battle cry: “Cyber security is a Culture, not a Product.” Basis of Presentation Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include our accounts and the accounts of our subsidiaries. All material intercompany accounts and transactions have been eliminated. Our interim financial statements are unaudited, and in our opinion, include all adjustments of a normal recurring nature necessary for the fair presentation of the periods presented. The results for the interim periods are not necessarily indicative of the results to be expected for any subsequent period or for the year ending December 31, 2023. These unaudited condensed consolidated financial statements and related notes should be read in conjunction with our audited financial statements for the year ended December 31, 2022. Going Concern The accompanying unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. For the six months ended June 30, 2023, we incurred a net loss of $ 64,170,352 5,318,960 16,022,786 23,144,217 7,121,431 1,872,175 Based on our current business plan, we believe our cash balance as of the date of this filing, together with anticipated revenues, will be sufficient to meet our anticipated cash requirement for the near term. However, there can be no assurance that the current business plan will be achievable. Such conditions raise substantial doubts about our ability to continue as a going concern for one year from the date the unaudited condensed consolidated financial statements are issued. Our existence is dependent upon our ability to develop profitable operations. We are devoting substantially all of our efforts to developing our business, reducing overhead costs, and raising capital, although there can be no assurance that our efforts will be successful. No assurance can be given that our actions will result in profitable operations or the resolution of liquidity problems. The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result should we be unable to continue as a going concern. In order to improve our liquidity, in addition to a planned reduction in overhead costs, we are actively pursuing additional debt and/or equity financing through discussions with investment bankers and private investors. There can be no assurance that we will be successful in our efforts to secure additional financing. The unaudited condensed consolidated financial statements do not include any adjustments relating to the recoverability of assets and the amount or classification of liabilities that might be necessary should we be unable to continue as a going concern. Reclassifications Reclassifications of certain immaterial prior period amounts have been made to conform to the current period presentation. Use of Estimates GAAP requires management to make estimates and assumptions that affect the reported amounts in our unaudited condensed consolidated financial statements. We periodically evaluate our estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results could materially differ. We believe the critical accounting policies discussed below affects our more significant judgments and estimates used in the preparation of the accompanying unaudited condensed consolidated financial statements. Significant estimates include the allowance for doubtful accounts, the carrying value of intangible assets and goodwill, deferred tax asset and valuation allowance, the estimated fair value of assets acquired, liabilities assumed and stock issued in business combinations, and assumptions used in the Black-Scholes option pricing model, such as expected volatility, risk-free interest rate, share price, and expected dividend rate. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Revenue Our revenue is derived from two major types of services to clients: security managed services and professional services. With respect to security managed services, we provide culture education and enablement, tools and technology provisioning, data and privacy monitoring, regulations and compliance monitoring, remote infrastructure administration, and cybersecurity services, including, but not limited to, antivirus and patch management. With respect to professional services, we provide cybersecurity consulting, compliance auditing, vulnerability assessment and penetration testing, and disaster recovery and data backup solutions. Our revenue is categorized and disaggregated as reflected in our unaudited condensed consolidated statement of operations as follows: Security Managed Services Security managed services revenue primarily consists of compliance, security managed services, SOC managed services, and vCISO. We considered these services to be a single performance obligation, and revenue is recognized as services and materials are provided to the customer. Professional Services Professional services revenue primarily consists of technical assessments, incident response and forensics, training, and other cybersecurity services. We considered these services to be a single performance obligation, and revenue is recognized in the period in which the performance obligations are satisfied. Accounts Receivable Accounts receivable are reported at their outstanding unpaid principal balances, net of allowances for doubtful accounts. We periodically assess our accounts and other receivables for collectability on a current expected credits loss basis. We provide for allowances for doubtful receivables based on management’s estimate of uncollectible amounts considering age, collection history, and any other factors considered appropriate. Payments are generally due within 30 days of invoice. We write off accounts receivable against the allowance for doubtful accounts when a balance is determined to be uncollectible. As of June 30, 2023 and December 31, 2022, our allowance for doubtful accounts was $ 287,780 270,011 Inventory Inventory consists of computer equipment for sale to customers. Inventory is measured using the first-in, first-out method and stated at lower of cost or net realizable value as of June 30, 2023 and December 31, 2022. The value of inventories is reduced for excess and obsolete inventories. We monitor inventory to identify events that would require impairment due to obsolete inventory and adjust the value of inventory when required. We recorded no Net Loss per Common Share Net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. For dilutive securities, all outstanding options are considered potentially outstanding common stock. The dilutive effect, if any, of stock options is calculated using the treasury stock method. All outstanding convertible notes are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method. Since the effect of common stock equivalents is anti-dilutive with respect to losses, the options and shares issuable upon conversion thereof have been excluded from our computation of net loss per common share for the three and six months ended June 30, 2023 and 2022. The following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to our net loss position even though the exercise price could be less than the average market price of the common shares: SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE June 30, 2023 December 31, 2022 Stock options 34,874,530 36,397,521 Warrant 744,200 144,200 Convertible debt 4,166,667 430,718 Total 39,785,397 36,972,439 Deferred Revenue Deferred revenue primarily consists of billings or payments received from customers in advance of revenue recognized for the services provided to our customers or annual licenses and is recognized as services are performed or ratably over the life of the license. We generally invoice customers in advance or in milestone-based installments. Deferred revenue of $ 2,835,291 D eferred revenue consisted of the following: SCHEDULE OF DEFERRED REVENUE June 30, 2023 December 31, 2022 Security managed services $ 4,089,323 $ 3,609,087 Professional services 960,675 863,053 Total deferred revenue $ 5,049,998 $ 4,472,140 Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities, including tax loss and credit carry forwards, are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. We utilize ASC 740, Income Taxes For uncertain tax positions that meet a “more likely than not” threshold, we recognize the benefit of uncertain tax positions in the unaudited condensed consolidated financial statements. Our practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when a determination is made that such expense is likely. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 3 – PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consisted of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, 2023 December 31, 2022 Prepaid expenses $ 1,444,642 $ 987,651 Prepaid taxes 729,944 572,645 Prepaid insurance 78,227 164,354 Total prepaid expenses and other current assets $ 2,252,813 $ 1,724,650 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 4 – PROPERTY AND EQUIPMENT Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2023 December 31, 2022 Computer equipment $ 1,333,443 $ 1,264,713 Building 1,877,281 1,776,040 Leasehold improvements 574,901 541,647 Vehicles 25,230 28,229 Furniture and fixtures 164,279 151,142 Software 1,808,339 1,667,283 Property and equipment gross 5,783,473 5,429,054 Less: accumulated depreciation (1,296,686 ) (748,559 ) Property and equipment, net $ 4,486,787 $ 4,680,495 Total depreciation expense was $ 236,106 178,309 541,811 332,383 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | NOTE 5 – INTANGIBLE ASSETS AND GOODWILL Goodwill During the quarterly period ended June 30, 2023, our share price reduction was determined to be an indicator of impairment under ASC 350 of our two reporting units, United States and Latin America. We performed an ongoing assessment to consider whether events or circumstances had occurred that could more likely than not reduce the fair value of a reporting unit below its carrying value. The valuation limitation from our recent share price decline caused us to perform an interim goodwill impairment test as of June 30, 2023. Based on the results of this testing, we recorded a $ 16,330,838 4,507,966 31,776,819 9,261,353 As part of our quantitative testing process for goodwill of the reporting units, we estimated fair values using a revenue multiple analysis, a form of the income approach, from the perspective of a market participant. Significant assumptions used in the revenue multiple approach are revenue growth rates and revenue multiples of key comparable companies within our industry. The following table summarizes the changes in goodwill during the six months ended June 30, 2023: SCHEDULE OF CHANGES IN GOODWILL Balance December 31, 2022 $ 76,664,017 Impairment (41,038,172 ) Foreign currency translation adjustment 1,717,523 Ending balance, June 30, 2023 $ 37,343,368 The remaining balance of goodwill for the reporting units continue to be at risk for future impairment. There continues to be uncertainty surrounding the factors impacting our business, and a sustained downturn, significantly extended recovery, or a change in long-term revenue growth or profitability for our reporting units could increase the likelihood of an additional future impairment. Additionally, changes in market participant assumptions or further share price reductions could increase the likelihood of further future impairment. Intangible Assets We performed an interim impairment test of our intangible assets based upon the conditions that precipitated the interim goodwill impairment test described above. Based on the results of this testing, we recorded pre-tax, non-cash impairment charges totaling zero 3,116,039 Fair values used in testing for potential impairment of our intangible assets are calculated using a discounted cash flows method by applying estimated cash flows from our forecasted revenue and expenses of the business that utilize those assets. The assumed cash flows from this calculation are discounted at a rate based on a market participant discount rate. There is uncertainty surrounding the revenue growth factors for these assets and a change in the long-term revenue growth rate or increase in the discount rate assumption could increase the likelihood of a future impairment. Following the recognition of the impairment losses, the affected assets had an aggregate carrying value of $ 540,192 Intangible assets, net are summarized as follows: SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS Gross Carrying Amount Accumulated Amortization Net Carrying Amount June 30, 2023 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Tradenames – trademarks $ 4,056,997 $ (1,943,623 ) $ 2,113,374 Customer base 1,198,533 (628,257 ) 570,276 Non-compete agreements 704,157 (562,893 ) 141,264 Intellectual property/technology 2,327,291 (851,481 ) 1,475,810 Intangible Asset $ 8,286,978 $ (3,986,254 ) $ 4,300,724 Gross Carrying Amount Accumulated Amortization Net Carrying Amount December 31, 2022 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Tradenames – trademarks $ 4,744,409 $ (1,167,476 ) $ 3,576,933 Customer base 2,949,143 (449,565 ) 2,499,578 Non-compete agreements 796,583 (436,611 ) 359,972 Intellectual property/technology 2,659,391 (620,645 ) 2,038,746 Intangible Asset $ 11,149,526 $ (2,674,297 ) $ 8,475,229 The weighted average remaining useful life of identifiable amortizable intangible assets remaining is 3.50 Amortization of identifiable intangible assets for the three months ended June 30, 2023 and 2022 was $ 524,602 512,503 1,271,774 817,467 Based on the balance of intangible assets at June 30, 2023, expected future amortization expense is as follows: SCHEDULE OF FUTURE AMORTIZATION EXPENSE 2023 (remainder of) $ 753,416 2024 1,235,989 2025 1,047,053 2026 971,298 2027 292,968 Future Amortization Expense $ 4,300,724 |
ACCOUNTS PAYABLE AND ACCRUED EX
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 6 – ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following amounts: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, 2023 December 31, 2022 Accounts payable $ 8,975,026 $ 5,267,492 Accrued payroll and bonuses 1,717,757 1,274,919 Accrued expenses 2,332,842 1,296,382 Accrued commissions 83,800 305,768 Accrued interest 149,546 165,776 Total accounts payable and accrued expenses $ 13,258,971 $ 8,310,337 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | Note 7 – RELATED PARTY TRANSACTIONS Independent Consulting Agreement with Stephen Scott In August 2020, we entered into an Independent Consulting Agreement with Stephen Scott, a then director of our company, with respect to advisory and consulting services relating to our strategic and business development and sales and marketing. Mr. Scott receives a consulting fee of $ 11,500 34,500 69,000 In July 2023, we entered into an Independent Consulting Agreement with Mr. Scott to provide, on a non-exclusive basis, advisory and consulting services relating to our strategic and business development, intellectual property development, banking relationships, and strategic M&A for a period of one year. Mr. Scott will receive a consulting fee of $ 15,000 Managed Services Agreement with Hensley Beverage Company – Related Party In July 2021, we entered into a 1-year Managed Services Agreement with Hensley Beverage Company to provide secured managed services. We also may be engaged by Hensley Beverage Company from time to time to provide other related services outside the scope of the Managed Services Agreement. While the agreement provides for a term through December 31, 2021, the agreement will continue until terminated by either party. For the three and six months ended June 30, 2023, we received $ 295,086 507,092 139,097 11,132 Convertible Note Payable with Hensley & Company In March 2023, we issued an unsecured convertible note to Hensley & Company in the principal amount of $ 5,000,000 10.00 March 20, 2025 1.20 125,000 138,888 138,888 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | Note 8 – STOCKHOLDERS’ EQUITY In May 2023, we completed a $ 4,000,000 20,000,000 600,000 2.0 Options We granted stock options vesting solely upon the continued service of the recipient. We recognize the accounting grant date fair value of equity-based awards as compensation expense over the required service period of each award. The following table summarizes stock option activity: SCHEDULE OF STOCK OPTIONS ACTIVITY Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Outstanding at January 1, 2023 36,397,521 $ 2.45 - - Granted 3,636,656 0.40 - - Exercised (1,040,817 ) 0.48 - - Expired or cancelled (4,118,830 ) 3.13 - - Outstanding at June 30, 2023 34,874,530 $ 2.20 5.44 $ - Exercisable at June 30, 2023 21,316,650 $ 1.76 3.68 $ - Total compensation expense related to the options was $ 3,363,719 3,572,189 8,635,778 8,179,332 27,068,138 2.35 Warrant Activity Summary The following table summarizes warrant activity: SCHEDULE OF STOCK WARRANT ACTIVITY Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Outstanding at January 1, 2023 144,200 $ 5.00 4.06 $ - Granted 600,000 0.25 5.00 - Exercised - - - - Expired or cancelled - - - - Outstanding at June 30, 2023 744,200 $ 1.17 4.37 $ - Exercisable at June 30, 2023 744,200 $ 1.17 4.37 $ - |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9 – COMMITMENTS AND CONTINGENCIES Legal Claims There are no material pending legal proceedings in which we or any of our subsidiaries are a party or in which any of our directors, officers or affiliates, any owner of record or beneficially of more than 5% of any class of our voting securities, or security holder is a party adverse to us or has a material interest adverse to us Indirect Taxes We are subject to indirect taxation in some, but not all, of the various states and foreign jurisdictions in which we conduct business. Laws and regulations attempting to subject commerce conducted over the Internet to various indirect taxes are becoming more prevalent, both in the United States. and internationally, and may impose additional burdens on us in the future. Increased regulation could negatively affect our business directly, as well as the business of our customers. Taxing authorities may impose indirect taxes on the Internet-related revenue we generated based on regulations currently being applied to similar, but not directly comparable, industries. There are many transactions and calculations where the ultimate indirect tax determination is uncertain. In addition, domestic and international indirect taxation laws are complex and subject to change. We may be audited in the future, which could result in changes to our indirect tax estimates. We continually evaluate those jurisdictions in which nexus exists, and believe we maintain adequate indirect tax accruals. As of June 30, 2023 and December 31, 2022, our accrual for estimated indirect tax liabilities was $ 819,959 409,187 Material Agreements We entered into a consulting agreement in May 2023 with Trending Equities Corp. to provide investor relations and capital introductions to us. The contract requires us to pay a minimum marketing spend of $ 1,100,000 950,000 |
LOANS PAYABLE AND LINES OF CRED
LOANS PAYABLE AND LINES OF CREDIT | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
LOANS PAYABLE AND LINES OF CREDIT | NOTE 10 – LOANS PAYABLE AND LINES OF CREDIT Loans Payable Loans payable was as follows: SCHEDULE OF LOAN PAYABLE Interest Rate Maturities June 30, 2023 December 31, 2022 Term loans (US dollar denominated) 5.00 155.11 % 2023 2027 $ 1,368,439 $ 5,461,520 Term loans (Chilean peso denominated) 3.48 7.14 % 2023 2029 5,970,400 6,541,113 7,338,839 12,002,633 Less, current portion (3,593,253 ) (7,758,831 ) Long term loans payable $ 3,745,586 $ 4,243,802 In June 2022, we entered into a bridge loan, secured by substantially all of our assets, in the principal amount of $ 5,000,000 4.00 December 14, 2022 4.00 7.50 zero 116,667 Various subsidiaries in the United States are borrowers under certain term loans. These term loans require monthly principal and interest payments. These term loans are secured by various assets owned by our subsidiaries. We recorded aggregate interest expense on these term loans of $ 32,257 38,479 zero 9.87 Our Latin America subsidiaries are the borrowers under certain term loans denominated in Chilean Pesos. These term loans require monthly principal and interest payments. These term loans are secured by various assets owned by our subsidiaries. We recorded aggregate interest expense on these term loans of $ 119,494 255,410 zero 8.17 In March 2023, we entered into a Cash Advance Agreement, pursuant to which we received gross proceeds of $ 2,000,000 87,500 99,398 2,870,000 155.11 497,525 584,053 Convertible Notes Payable In October 2021, we issued a convertible note to Neil Stinchcombe in the principal amount of $ 1,500,000 5.00 January 27, 2022 5.00 October 27, 2022 500,000 119,007 18,118 632 In June 2022, we issued an unsecured convertible note in the principal amount of $ 1,000,000 5.00 7.83 The outstanding principal of this note can be redeemed at any time by us or at maturity at 105% 1,050,000 9,601 22,101 In June 2023, we issued an unsecured convertible note in the principal amount of $ 1,050,000 10.00 June 7, 2024 4.20 5,480 In March 2023, we issued an unsecured convertible note to Hensley & Company in the principal amount of $ 5,000,000 10.00 March 20, 2025 1.20 125,000 138,888 138,888 Future minimum payments under the above loans payable and convertible notes payable due as of June 30, 2023 were as follows: SCHEDULE OF FUTURE MINIMUM PAYMENTS FOR LONG TERM DEBT 2023 (remainder of) $ 2,686,053 2024 2,775,049 2025 6,391,531 2026 596,496 2027 328,864 Thereafter 654,596 Total future minimum payments 13,432,589 Less: discount (43,750 ) Total 13,388,839 Less: current (4,643,253 ) Long term debt, net of current portion $ 8,745,586 |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2023 | |
Leases | |
LEASES | NOTE 11 – LEASES We have entered into various non-cancellable operating lease agreements for certain offices. These leases currently have lease periods expiring between 2023 and 2028. The lease agreements may include one or more options to renew. Renewals were not assumed in our determination of the lease term unless the renewals were deemed to be reasonably assured at lease commencement. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. The components of lease costs, weighted-average lease term, and discount rates are detailed below. When measuring lease liabilities for leases that were classified as operating leases, we discounted lease payments using our estimated incremental borrowing rate at the commencement date of each lease. The weighted average incremental borrowing rate applied was 9.78 4.15 Operating leases are included in the unaudited condensed Consolidated Balance Sheets as follows: SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION Classification June 30, 2023 December 31, 2022 Lease assets Operating lease cost ROU assets Assets $ 889,010 $ 255,687 Total lease assets $ 889,010 $ 255,687 Lease liabilities Operating lease liabilities, current Current liabilities $ 191,995 $ 121,731 Operating lease liabilities, non-current Liabilities 732,675 159,205 Total lease liabilities $ 924,670 $ 280,936 The components of lease costs, which are included in loss from operations in our unaudited condensed consolidated Statements of Operations, were as follows: SCHEDULE OF LEASE COST 2023 2022 Six Months Ended June 30, 2023 2022 Leases costs Operating lease costs $ 117,331 $ 226,079 Short term lease cost 45,823 - Total lease costs $ 163,154 $ 226,079 Future minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the six months ended June 30, 2023 were as follows: SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES Fiscal Year Operating Leases 2023 (remainder of) $ 153,307 2024 294,383 2025 252,513 2026 199,177 2027 205,145 Thereafter 51,661 Total future minimum lease payments 1,156,186 Amount representing interest (231,516) Present value of net future minimum lease payments $ 924,670 |
CONCENTRATION OF CREDIT RISK AN
CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS | 6 Months Ended |
Jun. 30, 2023 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS | NOTE 12 – CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS Our financial instruments exposed to concentrations of credit risk consist primarily of cash and cash equivalents. Although we deposit cash with multiple banks, these deposits, including those held in foreign branches of global banks, may exceed the amount of insurance provided on such deposits. These deposits may generally be redeemed upon demand and bear minimal risk. No single customer represented over 10 |
GEOGRAPHIC INFORMATION
GEOGRAPHIC INFORMATION | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
GEOGRAPHIC INFORMATION | NOTE 13 – GEOGRAPHIC INFORMATION Revenue by geography is based on the customer’s billing address and was as follows: SCHEDULE OF REVENUE BY GEOGRAPHY IS BASED ON CUSTOMERS BILLING ADDRESS 2023 2022 2023 2022 Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 U.S. $ 8,484,594 $ 9,358,105 $ 17,085,458 $ 17,764,335 Chile 6,791,435 1,869,840 11,682,753 2,793,020 All other countries 248,965 - 483,464 - Revenue $ 15,524,994 $ 11,227,945 $ 29,251,675 $ 20,557,355 Property and equipment, net by geography was as follows: SCHEDULE OF PROPERTY AND EQUIPMENT, NET BY GEOGRAPHIC AREAS June 30, 2023 December 31, 2022 U.S. $ 1,177,401 $ 1,198,057 Chile 3,308,253 3,480,911 All other countries 1,133 1,527 Property and equipment net $ 4,486,787 $ 4,680,495 No other international country represented more than 10% of property and equipment, net in any period presented. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | NOTE 14 – ACCUMULATED OTHER COMPREHENSIVE INCOME The following table presents AOCI activity in equity: SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME Foreign Currency Translation Adjustments Total AOCI Balance as of December 31, 2022 $ 1,062,247 $ 1,062,247 Other comprehensive income 1,620,726 1,620,726 Amounts reclassified from AOCI - - Balance as of June 30, 2023 $ 2,682,973 $ 2,682,973 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 15 – SUBSEQUENT EVENTS In July 2023, we entered into a stock purchase agreement with SB Cyber Technologies, LLC and its members, pursuant to which we acquired all of the issued and outstanding units of SB Cyber Technologies, LLC. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Revenue | Revenue Our revenue is derived from two major types of services to clients: security managed services and professional services. With respect to security managed services, we provide culture education and enablement, tools and technology provisioning, data and privacy monitoring, regulations and compliance monitoring, remote infrastructure administration, and cybersecurity services, including, but not limited to, antivirus and patch management. With respect to professional services, we provide cybersecurity consulting, compliance auditing, vulnerability assessment and penetration testing, and disaster recovery and data backup solutions. Our revenue is categorized and disaggregated as reflected in our unaudited condensed consolidated statement of operations as follows: Security Managed Services Security managed services revenue primarily consists of compliance, security managed services, SOC managed services, and vCISO. We considered these services to be a single performance obligation, and revenue is recognized as services and materials are provided to the customer. Professional Services Professional services revenue primarily consists of technical assessments, incident response and forensics, training, and other cybersecurity services. We considered these services to be a single performance obligation, and revenue is recognized in the period in which the performance obligations are satisfied. |
Accounts Receivable | Accounts Receivable Accounts receivable are reported at their outstanding unpaid principal balances, net of allowances for doubtful accounts. We periodically assess our accounts and other receivables for collectability on a current expected credits loss basis. We provide for allowances for doubtful receivables based on management’s estimate of uncollectible amounts considering age, collection history, and any other factors considered appropriate. Payments are generally due within 30 days of invoice. We write off accounts receivable against the allowance for doubtful accounts when a balance is determined to be uncollectible. As of June 30, 2023 and December 31, 2022, our allowance for doubtful accounts was $ 287,780 270,011 |
Inventory | Inventory Inventory consists of computer equipment for sale to customers. Inventory is measured using the first-in, first-out method and stated at lower of cost or net realizable value as of June 30, 2023 and December 31, 2022. The value of inventories is reduced for excess and obsolete inventories. We monitor inventory to identify events that would require impairment due to obsolete inventory and adjust the value of inventory when required. We recorded no |
Net Loss per Common Share | Net Loss per Common Share Net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding during the period. For dilutive securities, all outstanding options are considered potentially outstanding common stock. The dilutive effect, if any, of stock options is calculated using the treasury stock method. All outstanding convertible notes are considered common stock at the beginning of the period or at the time of issuance, if later, pursuant to the if-converted method. Since the effect of common stock equivalents is anti-dilutive with respect to losses, the options and shares issuable upon conversion thereof have been excluded from our computation of net loss per common share for the three and six months ended June 30, 2023 and 2022. The following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to our net loss position even though the exercise price could be less than the average market price of the common shares: SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE June 30, 2023 December 31, 2022 Stock options 34,874,530 36,397,521 Warrant 744,200 144,200 Convertible debt 4,166,667 430,718 Total 39,785,397 36,972,439 |
Deferred Revenue | Deferred Revenue Deferred revenue primarily consists of billings or payments received from customers in advance of revenue recognized for the services provided to our customers or annual licenses and is recognized as services are performed or ratably over the life of the license. We generally invoice customers in advance or in milestone-based installments. Deferred revenue of $ 2,835,291 D eferred revenue consisted of the following: SCHEDULE OF DEFERRED REVENUE June 30, 2023 December 31, 2022 Security managed services $ 4,089,323 $ 3,609,087 Professional services 960,675 863,053 Total deferred revenue $ 5,049,998 $ 4,472,140 |
Income Taxes | Income Taxes Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities, including tax loss and credit carry forwards, are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. We utilize ASC 740, Income Taxes For uncertain tax positions that meet a “more likely than not” threshold, we recognize the benefit of uncertain tax positions in the unaudited condensed consolidated financial statements. Our practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the unaudited condensed consolidated statements of operations when a determination is made that such expense is likely. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE | The following tables summarize the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive due to our net loss position even though the exercise price could be less than the average market price of the common shares: SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE June 30, 2023 December 31, 2022 Stock options 34,874,530 36,397,521 Warrant 744,200 144,200 Convertible debt 4,166,667 430,718 Total 39,785,397 36,972,439 |
SCHEDULE OF DEFERRED REVENUE | D eferred revenue consisted of the following: SCHEDULE OF DEFERRED REVENUE June 30, 2023 December 31, 2022 Security managed services $ 4,089,323 $ 3,609,087 Professional services 960,675 863,053 Total deferred revenue $ 5,049,998 $ 4,472,140 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS | Prepaid expenses and other current assets consisted of the following: SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS June 30, 2023 December 31, 2022 Prepaid expenses $ 1,444,642 $ 987,651 Prepaid taxes 729,944 572,645 Prepaid insurance 78,227 164,354 Total prepaid expenses and other current assets $ 2,252,813 $ 1,724,650 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2023 December 31, 2022 Computer equipment $ 1,333,443 $ 1,264,713 Building 1,877,281 1,776,040 Leasehold improvements 574,901 541,647 Vehicles 25,230 28,229 Furniture and fixtures 164,279 151,142 Software 1,808,339 1,667,283 Property and equipment gross 5,783,473 5,429,054 Less: accumulated depreciation (1,296,686 ) (748,559 ) Property and equipment, net $ 4,486,787 $ 4,680,495 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF CHANGES IN GOODWILL | The following table summarizes the changes in goodwill during the six months ended June 30, 2023: SCHEDULE OF CHANGES IN GOODWILL Balance December 31, 2022 $ 76,664,017 Impairment (41,038,172 ) Foreign currency translation adjustment 1,717,523 Ending balance, June 30, 2023 $ 37,343,368 |
SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS | Intangible assets, net are summarized as follows: SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS Gross Carrying Amount Accumulated Amortization Net Carrying Amount June 30, 2023 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Tradenames – trademarks $ 4,056,997 $ (1,943,623 ) $ 2,113,374 Customer base 1,198,533 (628,257 ) 570,276 Non-compete agreements 704,157 (562,893 ) 141,264 Intellectual property/technology 2,327,291 (851,481 ) 1,475,810 Intangible Asset $ 8,286,978 $ (3,986,254 ) $ 4,300,724 Gross Carrying Amount Accumulated Amortization Net Carrying Amount December 31, 2022 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Tradenames – trademarks $ 4,744,409 $ (1,167,476 ) $ 3,576,933 Customer base 2,949,143 (449,565 ) 2,499,578 Non-compete agreements 796,583 (436,611 ) 359,972 Intellectual property/technology 2,659,391 (620,645 ) 2,038,746 Intangible Asset $ 11,149,526 $ (2,674,297 ) $ 8,475,229 |
SCHEDULE OF FUTURE AMORTIZATION EXPENSE | Based on the balance of intangible assets at June 30, 2023, expected future amortization expense is as follows: SCHEDULE OF FUTURE AMORTIZATION EXPENSE 2023 (remainder of) $ 753,416 2024 1,235,989 2025 1,047,053 2026 971,298 2027 292,968 Future Amortization Expense $ 4,300,724 |
ACCOUNTS PAYABLE AND ACCRUED _2
ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES | Accounts payable and accrued expenses consisted of the following amounts: SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES June 30, 2023 December 31, 2022 Accounts payable $ 8,975,026 $ 5,267,492 Accrued payroll and bonuses 1,717,757 1,274,919 Accrued expenses 2,332,842 1,296,382 Accrued commissions 83,800 305,768 Accrued interest 149,546 165,776 Total accounts payable and accrued expenses $ 13,258,971 $ 8,310,337 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
SCHEDULE OF STOCK OPTIONS ACTIVITY | The following table summarizes stock option activity: SCHEDULE OF STOCK OPTIONS ACTIVITY Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Outstanding at January 1, 2023 36,397,521 $ 2.45 - - Granted 3,636,656 0.40 - - Exercised (1,040,817 ) 0.48 - - Expired or cancelled (4,118,830 ) 3.13 - - Outstanding at June 30, 2023 34,874,530 $ 2.20 5.44 $ - Exercisable at June 30, 2023 21,316,650 $ 1.76 3.68 $ - |
SCHEDULE OF STOCK WARRANT ACTIVITY | The following table summarizes warrant activity: SCHEDULE OF STOCK WARRANT ACTIVITY Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregate Intrinsic Value Outstanding at January 1, 2023 144,200 $ 5.00 4.06 $ - Granted 600,000 0.25 5.00 - Exercised - - - - Expired or cancelled - - - - Outstanding at June 30, 2023 744,200 $ 1.17 4.37 $ - Exercisable at June 30, 2023 744,200 $ 1.17 4.37 $ - |
LOANS PAYABLE AND LINES OF CR_2
LOANS PAYABLE AND LINES OF CREDIT (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF LOAN PAYABLE | Loans payable was as follows: SCHEDULE OF LOAN PAYABLE Interest Rate Maturities June 30, 2023 December 31, 2022 Term loans (US dollar denominated) 5.00 155.11 % 2023 2027 $ 1,368,439 $ 5,461,520 Term loans (Chilean peso denominated) 3.48 7.14 % 2023 2029 5,970,400 6,541,113 7,338,839 12,002,633 Less, current portion (3,593,253 ) (7,758,831 ) Long term loans payable $ 3,745,586 $ 4,243,802 |
SCHEDULE OF FUTURE MINIMUM PAYMENTS FOR LONG TERM DEBT | Future minimum payments under the above loans payable and convertible notes payable due as of June 30, 2023 were as follows: SCHEDULE OF FUTURE MINIMUM PAYMENTS FOR LONG TERM DEBT 2023 (remainder of) $ 2,686,053 2024 2,775,049 2025 6,391,531 2026 596,496 2027 328,864 Thereafter 654,596 Total future minimum payments 13,432,589 Less: discount (43,750 ) Total 13,388,839 Less: current (4,643,253 ) Long term debt, net of current portion $ 8,745,586 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Leases | |
SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION | Operating leases are included in the unaudited condensed Consolidated Balance Sheets as follows: SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION Classification June 30, 2023 December 31, 2022 Lease assets Operating lease cost ROU assets Assets $ 889,010 $ 255,687 Total lease assets $ 889,010 $ 255,687 Lease liabilities Operating lease liabilities, current Current liabilities $ 191,995 $ 121,731 Operating lease liabilities, non-current Liabilities 732,675 159,205 Total lease liabilities $ 924,670 $ 280,936 |
SCHEDULE OF LEASE COST | The components of lease costs, which are included in loss from operations in our unaudited condensed consolidated Statements of Operations, were as follows: SCHEDULE OF LEASE COST 2023 2022 Six Months Ended June 30, 2023 2022 Leases costs Operating lease costs $ 117,331 $ 226,079 Short term lease cost 45,823 - Total lease costs $ 163,154 $ 226,079 |
SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES | Future minimum payments under non-cancelable leases for operating leases for the remaining terms of the leases following the six months ended June 30, 2023 were as follows: SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES Fiscal Year Operating Leases 2023 (remainder of) $ 153,307 2024 294,383 2025 252,513 2026 199,177 2027 205,145 Thereafter 51,661 Total future minimum lease payments 1,156,186 Amount representing interest (231,516) Present value of net future minimum lease payments $ 924,670 |
GEOGRAPHIC INFORMATION (Tables)
GEOGRAPHIC INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
SCHEDULE OF REVENUE BY GEOGRAPHY IS BASED ON CUSTOMERS BILLING ADDRESS | Revenue by geography is based on the customer’s billing address and was as follows: SCHEDULE OF REVENUE BY GEOGRAPHY IS BASED ON CUSTOMERS BILLING ADDRESS 2023 2022 2023 2022 Three Months Ended June 30, Six Months Ended June 30, 2023 2022 2023 2022 U.S. $ 8,484,594 $ 9,358,105 $ 17,085,458 $ 17,764,335 Chile 6,791,435 1,869,840 11,682,753 2,793,020 All other countries 248,965 - 483,464 - Revenue $ 15,524,994 $ 11,227,945 $ 29,251,675 $ 20,557,355 |
SCHEDULE OF PROPERTY AND EQUIPMENT, NET BY GEOGRAPHIC AREAS | Property and equipment, net by geography was as follows: SCHEDULE OF PROPERTY AND EQUIPMENT, NET BY GEOGRAPHIC AREAS June 30, 2023 December 31, 2022 U.S. $ 1,177,401 $ 1,198,057 Chile 3,308,253 3,480,911 All other countries 1,133 1,527 Property and equipment net $ 4,486,787 $ 4,680,495 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME | The following table presents AOCI activity in equity: SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME Foreign Currency Translation Adjustments Total AOCI Balance as of December 31, 2022 $ 1,062,247 $ 1,062,247 Other comprehensive income 1,620,726 1,620,726 Amounts reclassified from AOCI - - Balance as of June 30, 2023 $ 2,682,973 $ 2,682,973 |
ORGANIZATION OF BUSINESS AND _2
ORGANIZATION OF BUSINESS AND GOING CONCERN (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||
Net loss | $ 29,328,663 | $ 7,339,846 | $ 64,170,352 | $ 15,369,627 | |
Cash flow from operations | 5,318,960 | $ 3,574,474 | |||
Current assets | 16,022,786 | 16,022,786 | $ 14,398,795 | ||
Current liabilities | 23,144,217 | 23,144,217 | 23,213,039 | ||
Working capital deficit | 7,121,431 | 7,121,431 | |||
Cash and cash equivalents | $ 1,872,175 | $ 1,872,175 | $ 1,833,163 |
SUMMARY OF SECURITIES EXCLUDED
SUMMARY OF SECURITIES EXCLUDED FROM DILUTED PER SHARE (Details) - shares | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 39,785,397 | 36,972,439 |
Share-Based Payment Arrangement, Option [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 34,874,530 | 36,397,521 |
Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 744,200 | 144,200 |
Convertible Debt [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities excluded from the diluted per share calculation | 4,166,667 | 430,718 |
SCHEDULE OF DEFERRED REVENUE (D
SCHEDULE OF DEFERRED REVENUE (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Product Information [Line Items] | ||
Total deferred revenue | $ 5,049,998 | $ 4,472,140 |
Security Managed Services [Member] | ||
Product Information [Line Items] | ||
Total deferred revenue | 4,089,323 | 3,609,087 |
Professional Services [Member] | ||
Product Information [Line Items] | ||
Total deferred revenue | $ 960,675 | $ 863,053 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | |||
Allowances for doubtful accounts | $ 287,780 | $ 270,011 | |
Inventory impairment losses | 0 | $ 0 | |
Deferred revenue | $ 2,835,291 |
SCHEDULE OF PREPAID EXPENSES AN
SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 1,444,642 | $ 987,651 |
Prepaid taxes | 729,944 | 572,645 |
Prepaid insurance | 78,227 | 164,354 |
Total prepaid expenses and other current assets | $ 2,252,813 | $ 1,724,650 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 5,783,473 | $ 5,429,054 |
Less: accumulated depreciation | (1,296,686) | (748,559) |
Property and equipment, net | 4,486,787 | 4,680,495 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 1,333,443 | 1,264,713 |
Building [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 1,877,281 | 1,776,040 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 574,901 | 541,647 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 25,230 | 28,229 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | 164,279 | 151,142 |
Software Development [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment gross | $ 1,808,339 | $ 1,667,283 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 236,106 | $ 178,309 | $ 541,811 | $ 332,383 |
SCHEDULE OF CHANGES IN GOODWILL
SCHEDULE OF CHANGES IN GOODWILL (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Balance beginning | $ 76,664,017 | |||
Goodwill, Impairment Loss | $ (20,838,804) | (41,038,172) | ||
Foreign currency translation adjustment | 1,717,523 | |||
Ending balance | $ 37,343,368 | $ 37,343,368 |
SUMMARY OF IDENTIFIABLE INTANGI
SUMMARY OF IDENTIFIABLE INTANGIBLE ASSETS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 8,286,978 | $ 11,149,526 |
Accumulated Amortization | (3,986,254) | (2,674,297) |
Net Carrying Amount | 4,300,724 | 8,475,229 |
Trademarks and Trade Names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 4,056,997 | 4,744,409 |
Accumulated Amortization | (1,943,623) | (1,167,476) |
Net Carrying Amount | 2,113,374 | 3,576,933 |
Customer Base [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,198,533 | 2,949,143 |
Accumulated Amortization | (628,257) | (449,565) |
Net Carrying Amount | 570,276 | 2,499,578 |
Noncompete Agreements [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 704,157 | 796,583 |
Accumulated Amortization | (562,893) | (436,611) |
Net Carrying Amount | 141,264 | 359,972 |
Intellectual Property [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,327,291 | 2,659,391 |
Accumulated Amortization | (851,481) | (620,645) |
Net Carrying Amount | $ 1,475,810 | $ 2,038,746 |
SCHEDULE OF FUTURE AMORTIZATION
SCHEDULE OF FUTURE AMORTIZATION EXPENSE (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2023 (remainder of) | $ 753,416 | |
2024 | 1,235,989 | |
2025 | 1,047,053 | |
2026 | 971,298 | |
2027 | 292,968 | |
Future Amortization Expense | $ 4,300,724 | $ 8,475,229 |
INTANGIBLE ASSETS AND GOODWIL_2
INTANGIBLE ASSETS AND GOODWILL (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Impairment loss | $ 540,192 | |||
Pre-tax non-cash impairment charges | $ 0 | $ 3,116,039 | ||
Weighted average remaining useful life | 3 years 6 months | 3 years 6 months | ||
Amortization of identifiable intangible assets | $ 524,602 | $ 512,503 | $ 1,271,774 | $ 817,467 |
UNITED STATES | ||||
Impairment loss | 16,330,838 | 31,776,819 | ||
Latin America [Member] | ||||
Impairment loss | $ 4,507,966 | $ 9,261,353 |
SCHEDULE OF ACCOUNTS PAYABLE AN
SCHEDULE OF ACCOUNTS PAYABLE AND ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Payables and Accruals [Abstract] | ||
Accounts payable | $ 8,975,026 | $ 5,267,492 |
Accrued payroll and bonuses | 1,717,757 | 1,274,919 |
Accrued expenses | 2,332,842 | 1,296,382 |
Accrued commissions | 83,800 | 305,768 |
Accrued interest | 149,546 | 165,776 |
Total accounts payable and accrued expenses | $ 13,258,971 | $ 8,310,337 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Jul. 31, 2023 | Mar. 31, 2023 | Aug. 31, 2020 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Related Party Transaction [Line Items] | |||||||
Consulting fees | $ 663,552 | $ 945,148 | $ 2,340,939 | $ 1,568,209 | |||
Interest expense | 766,090 | 64,648 | 1,156,231 | 108,233 | |||
Unsecured Debt [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Debt instrument face amount | $ 5,000,000 | ||||||
Debt instrument interest rate | 10% | ||||||
Maturity date | Mar. 20, 2025 | ||||||
Conversion price | $ 1.20 | ||||||
Interest expense | 125,000 | 138,888 | |||||
Accrued interest | 138,888 | 138,888 | |||||
Independent Consulting Agreement [Member] | Stephen Scott [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Consulting fees | $ 11,500 | 34,500 | 69,000 | ||||
Independent Consulting Agreement [Member] | Stephen Scott [Member] | Subsequent Event [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Consulting fees | $ 15,000 | ||||||
One Year Managed Services Agreement [Member] | Hensley Beverage Company [Member] | Related Party [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Revenues | 295,086 | 507,092 | |||||
Outstanding receivable related parties | $ 139,097 | $ 11,132 | $ 139,097 | $ 11,132 |
SCHEDULE OF STOCK OPTIONS ACTIV
SCHEDULE OF STOCK OPTIONS ACTIVITY (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Equity [Abstract] | |
Number of Shares Outstanding, Beginning | shares | 36,397,521 |
Weighted Average Exercise Price Outstanding, Beginning | $ / shares | $ 2.45 |
Number of Shares Outstanding, Granted | shares | 3,636,656 |
Weighted Average Exercise Price, Granted | $ / shares | $ 0.40 |
Number of Shares Outstanding, Exercised | shares | (1,040,817) |
Weighted Average Exercise Price, Exercised | $ / shares | $ 0.48 |
Number of Shares Outstanding, Expired or cancelled | shares | (4,118,830) |
Weighted Average Exercise Price, Expired or cancelled | $ / shares | $ 3.13 |
Number of Shares Outstanding, Ending | shares | 34,874,530 |
Weighted Average Exercise Price Outstanding, Ending | $ / shares | $ 2.20 |
Weighted Average Remaining Contractual Life Outstanding, Ending | 5 years 5 months 8 days |
Aggregate Iintrinsic Value Outstanding Ending | $ | |
Number of Shares Outstanding, Exercisable | shares | 21,316,650 |
weighted Average Exercise Price, Exercisable Ending | $ / shares | $ 1.76 |
Weighted Average Remaining Contractual Life, Exercisable Ending | 3 years 8 months 4 days |
Aggregate Intrinsic Value Exercisable Ending | $ |
SCHEDULE OF STOCK WARRANT ACTIV
SCHEDULE OF STOCK WARRANT ACTIVITY (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) $ / shares shares | |
Equity [Abstract] | |
Number of Warrants Outstanding, Beginning | shares | 144,200 |
Weighted Average Exercise Price, Beginning | $ / shares | $ 5 |
Weighted Average Remaining Contractual Life, Beginning | 4 years 21 days |
Aggregate Intrinsic Value, Beginning | $ | |
Number of Warrants, Granted | shares | 600,000 |
Weighted Average Exercise Price, Granted | $ / shares | $ 0.25 |
Weighted Average Remaining Contractual Life, Granted | 5 years |
Number of Warrants, Exercised | shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
Number of Warrants, Expired or Cancelled | shares | |
Weighted Average Exercise Price, Expired or Cancelled | $ / shares | |
Number of Warrants Outstanding, Ending | shares | 744,200 |
Weighted Average Exercise Price, Ending | $ / shares | $ 1.17 |
Weighted Average Remaining Contractual Life, Ending | 4 years 4 months 13 days |
Aggregate Intrinsic Value, Ending | $ | |
Number of Warrants, Exercisable | shares | 744,200 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 1.17 |
Weighted Average Remaining Contractual Life, Exercisable | 4 years 4 months 13 days |
Aggregate Intrinsic Value, Exercisable | $ |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
May 31, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Direct offering Cost | $ 6,682,198 | ||||
Stock based compensation | $ 3,363,719 | $ 3,572,189 | 8,635,778 | $ 8,179,332 | |
Unrecognized stock-based compensation expense | $ 27,068,138 | $ 27,068,138 | |||
Unrecognized stock-based compensation expense, recognition period | 2 years 4 months 6 days | ||||
Placement Agent Warrant [Member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Direct offering Cost | $ 4,000,000 | ||||
Direct offering shares | 20,000,000 | ||||
Warrants to purchase common stock | 600,000 | ||||
Net proceeds | $ 2,000,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 6 Months Ended | |
May 31, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Description for voting securities | beneficially of more than 5% of any class of our voting securities, or security holder is a party adverse to us or has a material interest adverse to us | ||
Indirect tax liabilities | $ 819,959 | $ 409,187 | |
Consulting Agreement [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Marketing expense | $ 1,100,000 | ||
Contractual obligation | $ 950,000 |
SCHEDULE OF LOAN PAYABLE (Detai
SCHEDULE OF LOAN PAYABLE (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Short-Term Debt [Line Items] | ||
Loans payable | $ 7,338,839 | $ 12,002,633 |
Less current portion | (3,593,253) | (7,758,831) |
Long term loans payable | 3,745,586 | 4,243,802 |
Term Loans One [Member] | ||
Short-Term Debt [Line Items] | ||
Loans payable | $ 1,368,439 | 5,461,520 |
Term Loans One [Member] | Minimum [Member] | ||
Short-Term Debt [Line Items] | ||
Line of credit facility interest rate percentage | 5% | |
Line of credit maturity description | 2023 | |
Term Loans One [Member] | Maximum [Member] | ||
Short-Term Debt [Line Items] | ||
Line of credit facility interest rate percentage | 155.11% | |
Line of credit maturity description | 2027 | |
Term Loans Two [Member] | ||
Short-Term Debt [Line Items] | ||
Loans payable | $ 5,970,400 | $ 6,541,113 |
Term Loans Two [Member] | Minimum [Member] | ||
Short-Term Debt [Line Items] | ||
Line of credit facility interest rate percentage | 3.48% | |
Line of credit maturity description | 2023 | |
Term Loans Two [Member] | Maximum [Member] | ||
Short-Term Debt [Line Items] | ||
Line of credit facility interest rate percentage | 7.14% | |
Line of credit maturity description | 2029 |
SCHEDULE OF FUTURE MINIMUM PAYM
SCHEDULE OF FUTURE MINIMUM PAYMENTS FOR LONG TERM DEBT (Details) | Jun. 30, 2023 USD ($) |
Debt Disclosure [Abstract] | |
2023 (remainder of) | $ 2,686,053 |
2024 | 2,775,049 |
2025 | 6,391,531 |
2026 | 596,496 |
2027 | 328,864 |
Thereafter | 654,596 |
Total future minimum payments | 13,432,589 |
Less: discount | (43,750) |
Total | 13,388,839 |
Less: current | (4,643,253) |
Long term debt, net of current portion | $ 8,745,586 |
LOANS PAYABLE AND LINES OF CR_3
LOANS PAYABLE AND LINES OF CREDIT (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||
May 31, 2023 | Apr. 28, 2023 | Mar. 31, 2023 | Mar. 10, 2022 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Oct. 31, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||||||||||||
Interest expense | $ 766,090 | $ 64,648 | $ 1,156,231 | $ 108,233 | |||||||||
Proceeds from convertable debt | 1,050,000 | 1,000,000 | |||||||||||
Cash Advance Agreement [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest expense | 497,525 | 584,053 | |||||||||||
Aggregate effective interest rate | 155.11% | 155.11% | |||||||||||
Proceeds from convertable debt | $ 2,000,000 | ||||||||||||
Upfront fees | 87,500 | ||||||||||||
Periodic payment | 99,398 | ||||||||||||
Repayments for debt | 2,870,000 | ||||||||||||
Term Loans One [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest expense | 32,257 | 38,479 | |||||||||||
Interest and debt expense | $ 0 | $ 0 | $ 0 | ||||||||||
Aggregate effective interest rate | 9.87% | 9.87% | 9.87% | ||||||||||
Term Loans Two [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest expense | $ 119,494 | $ 255,410 | |||||||||||
Interest and debt expense | $ 0 | $ 0 | $ 0 | ||||||||||
Aggregate effective interest rate | 8.17% | 8.17% | 8.17% | ||||||||||
Convertible Note Payable [Member] | Neil Stinchcombe [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument face amount | $ 1,500,000 | ||||||||||||
Debt instrument interest rate | 5% | ||||||||||||
Maturity date | Oct. 27, 2022 | Jan. 27, 2022 | |||||||||||
Interest expense | $ 632 | ||||||||||||
Interest and debt expense | $ 119,007 | ||||||||||||
Conversion price | $ 5 | ||||||||||||
Interest income | $ 18,118 | ||||||||||||
Convertible Note Payable [Member] | Neil Stinchcombe [Member] | Installment One [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Periodic payment | $ 500,000 | ||||||||||||
Convertible Note Payable [Member] | Neil Stinchcombe [Member] | Installment Two [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Periodic payment | $ 500,000 | ||||||||||||
Convertible Note Payable [Member] | Neil Stinchcombe [Member] | Installment Three [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Periodic payment | $ 500,000 | ||||||||||||
Convertible Note Payable [Member] | Mr Mc Cain [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest and debt expense | $ 138,888 | 138,888 | 138,888 | ||||||||||
Unsecured Debt [Member] | Convertible Notes Payable [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument face amount | $ 5,000,000 | $ 1,050,000 | $ 5,000,000 | $ 1,000,000 | $ 1,050,000 | $ 1,000,000 | $ 1,050,000 | $ 1,000,000 | |||||
Debt instrument interest rate | 10% | 10% | 10% | 5% | 10% | 5% | 10% | 5% | |||||
Maturity date | Jun. 07, 2024 | Mar. 20, 2025 | |||||||||||
Interest expense | $ 9,601 | $ 22,101 | |||||||||||
Conversion price | $ 1.20 | $ 1.20 | $ 7.83 | $ 7.83 | $ 7.83 | ||||||||
Debt instrument redemption, description | The outstanding principal of this note can be redeemed at any time by us or at maturity at 105% | ||||||||||||
Unsecured Debt [Member] | VCISO LLC [Member] | Convertible Notes Payable [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument interest rate | 4.20% | 4.20% | 4.20% | ||||||||||
Interest expense | $ 5,480 | $ 5,480 | |||||||||||
Unsecured Debt [Member] | Mr Mc Cain [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Interest expense | 125,000 | 138,888 | |||||||||||
Bridge Loan [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument face amount | $ 5,000,000 | $ 5,000,000 | $ 5,000,000 | ||||||||||
Debt instrument interest rate | 4% | 4% | 4% | ||||||||||
Maturity date | Dec. 14, 2022 | ||||||||||||
Interest expense | $ 0 | $ 116,667 | |||||||||||
Bridge Loan [Member] | Minimum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument interest rate | 4% | 4% | 4% | ||||||||||
Bridge Loan [Member] | Maximum [Member] | |||||||||||||
Debt Instrument [Line Items] | |||||||||||||
Debt instrument interest rate | 7.50% | 7.50% | 7.50% |
SCHEDULE OF LEASE COST AND OTHE
SCHEDULE OF LEASE COST AND OTHER SUPPLEMENT LEASE INFORMATION (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Leases | ||
Operating lease cost ROU assets | $ 889,010 | $ 255,687 |
Total lease assets | 889,010 | 255,687 |
Operating lease liabilities, current | 191,995 | 121,731 |
Operating lease liabilities, non-current | 732,675 | 159,205 |
Total lease liabilities | $ 924,670 | $ 280,936 |
SCHEDULE OF LEASE COST (Details
SCHEDULE OF LEASE COST (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Leases | ||
Operating lease costs | $ 117,331 | $ 226,079 |
Short term lease cost | 45,823 | |
Total lease costs | $ 163,154 | $ 226,079 |
SCHEDULE OF FUTURE MINIMUM UNDE
SCHEDULE OF FUTURE MINIMUM UNDER NON-CANCELLABLE LEASES FOR OPERATING LEASES (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Leases | ||
2023 (remainder of) | $ 153,307 | |
2024 | 294,383 | |
2025 | 252,513 | |
2026 | 199,177 | |
2027 | 205,145 | |
Thereafter | 51,661 | |
Total future minimum lease payments | 1,156,186 | |
Amount representing interest | (231,516) | |
Present value of net future minimum lease payments | $ 924,670 | $ 280,936 |
LEASES (Details Narrative)
LEASES (Details Narrative) | Jun. 30, 2023 |
Leases | |
Weighted average incremental borrowing rate | 9.78% |
Operating lease, weighted average remaining lease term | 4 years 1 month 24 days |
CONCENTRATION OF CREDIT RISK _2
CONCENTRATION OF CREDIT RISK AND SIGNIFICANT CUSTOMERS (Details Narrative) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue Benchmark [Member] | Customer Concentration Risk [Member] | No Single Customer [Member] | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 10% |
SCHEDULE OF REVENUE BY GEOGRAPH
SCHEDULE OF REVENUE BY GEOGRAPHY IS BASED ON CUSTOMERS BILLING ADDRESS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 15,524,994 | $ 11,227,945 | $ 29,251,675 | $ 20,557,355 |
UNITED STATES | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 8,484,594 | 9,358,105 | 17,085,458 | 17,764,335 |
CHILE | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | 6,791,435 | 1,869,840 | 11,682,753 | 2,793,020 |
All Other Countries [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenue | $ 248,965 | $ 483,464 |
SCHEDULE OF PROPERTY AND EQUI_2
SCHEDULE OF PROPERTY AND EQUIPMENT, NET BY GEOGRAPHIC AREAS (Details) - USD ($) | Jun. 30, 2023 | Dec. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment net | $ 4,486,787 | $ 4,680,495 |
UNITED STATES | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment net | 1,177,401 | 1,198,057 |
CHILE | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment net | 3,308,253 | 3,480,911 |
All Other Countries [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and equipment net | $ 1,133 | $ 1,527 |
SCHEDULE OF ACCUMULATED OTHER C
SCHEDULE OF ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Balance as of December 31, 2022 | $ 1,062,247 |
Other comprehensive income | 1,620,726 |
Amounts reclassified from AOCI | |
Balance as of June 30, 2023 | 2,682,973 |
Foreign Currency Gain (Loss) [Member] | |
Balance as of December 31, 2022 | 1,062,247 |
Other comprehensive income | 1,620,726 |
Amounts reclassified from AOCI | |
Balance as of June 30, 2023 | $ 2,682,973 |